Reassessment notices issued to deceased assessees are invalid because the legal-representative provisions permit either continuation of proceedings started during the assessee's lifetime or fresh proceedings directly against the legal representative; they do not permit a notice to be issued in the deceased person's name and later continued against an heir. Consequently, reassessment founded on such a notice is unsustainable and must be quashed. Where jurisdiction fails at the notice stage, challenges to the underlying additions need not be adjudicated and remain open.

Registered societies returning income in the status of an association of persons or body of individuals are considered for normal tax rates where returned total income remains below the taxable limit. Application of the maximum marginal rate under section 167B is not warranted in those circumstances. Tax computation should therefore follow normal rates, and a return showing income below the taxable limit results in no tax liability.

Exclusivity fee received in cash for an aborted joint venture involving transfer of subsidiary shares is a capital receipt where the agreement merely restricts negotiations with other prospective buyers and does not restrict business activities. The monetary receipt falls outside the then-applicable scope of business benefits, and the non-compete provision does not apply because no business activity was restrained. The fee is therefore not taxable under normal provisions or while computing book profit, and its credit to capital reserve stands. Expenditure disallowance relating to exempt income cannot apply where no exempt income was earned; the later explanatory amendment operates prospectively from AY 2022-23.

Gross sale consideration from alleged penny-stock transactions cannot be treated as undisclosed income without examining the underlying transactions and establishing a cogent nexus between the taxpayer and the alleged accommodation-entry arrangement. Recorded books, contract notes, bank statements and broker entries require specific contrary material before being disregarded. General investigation material describing a penny-stock modus operandi may justify further enquiry but does not, by itself, prove that particular transactions are fictitious or represent unaccounted money. A premise that exempt capital gains were claimed must also be supported by the return and computation. Interest on such an addition is consequential and must correspond to finally determined income.

Educational activities comprising banking-industry examinations, training programmes and related instruction qualify as charitable education where they equip banking personnel to perform their functions efficiently. Restricting benefits to a section of the public does not negate charitable character, and refusal of approval under a separate educational-institution regime does not determine exemption under charitable-trust provisions. Tax-free bond interest required no separate relief where exemption governed the institution's income computation. No depreciation disallowance arose because depreciation was not claimed. Accumulation of charitable income was permissible because the prescribed form identified definite purposes, including premises acquisition and renovation and development of educational, testing and data-centre facilities, rather than general objects.

Transfer pricing requires selection of the most appropriate method based on transaction nature and comparable-data reliability, with neither CUP nor TNMM having statutory priority. An external CUP based on an associated enterprise's purchases from independent suppliers may be reliable where geographic, volume or timing differences do not materially affect price or can be reasonably adjusted. TNMM may be unreliable without meaningful adjustment for abnormal fixed costs from low capacity utilisation. Foreign-currency borrowings and receivables require currency-specific benchmarking under comparable uncontrolled conditions. Delayed export receivables constitute separate international transactions, with interest benchmarked at LIBOR plus 200 basis points after a 60-day credit period.

Section 153C jurisdiction was upheld by the majority because both Assessing Officers recorded satisfaction that seized material related to the assessee and affected income determination. No prescribed period governed satisfaction by the Assessing Officer of the other person, and assessment limitation ran from transfer of the seized material. Natural justice did not require supplying statements or permitting cross-examination because the addition rested on seized electronic records rather than witness statements. The seized Excel sheet was treated as corroborated evidence of unexplained investment in a jointly acquired bungalow, as its transaction particulars matched the registered sale deed. The addition remained sustained, subject to verification of the assessee's ownership share and proportionate adjustment.

Recurring trademark fees paid under a non-exclusive, time-bound licence are revenue expenditure where proprietary rights remain with the licensor. The enduring benefit test requires examination of whether the agreement transfers ownership, exclusive rights, or a lasting capital asset. Limited permission to use a trademark, coupled with an obligation to stop using it on termination, does not create such an asset. Annual fees calculated as a percentage of gross profit are recurring operational payments and remain deductible as revenue expenditure. The disallowance of the licensed trademark fee was therefore deleted.

Reversal of opening accrued and unbilled revenue already recognised and taxed in an earlier year was allowable where an indistinguishable coordinate-bench ruling applied; the related disallowance was deleted. Professional fees paid to non-residents were not established as royalty under the applicable tax treaty. Consequently, non-deduction of tax under section 195 did not justify disallowance, and deletion of that adjustment was sustained. The taxpayer's appeal succeeded, while the Revenue's appeal failed.

Penalty for inaccurate particulars in professional-fee claims requires substantiated expenditure and independent findings supporting concealment or inaccurate particulars. A payment characterised as professional fees but shown to be a loan advanced and repaid, with a corresponding receipt credited to profit and loss, is revenue neutral and does not support disallowance or penalty. Conversely, penalty remains justified where claimed payees deny receipt or payments remain unsubstantiated. Liability to deduct tax on professional fees depends on satisfying the statutory threshold based on gross receipts in the immediately preceding financial year; older receipt data alone is insufficient. Disallowance for non-deduction of tax does not, by itself, justify penalty.

Deemed concealment under Explanation 3 to section 271(1)(c) may apply where a taxpayer files a return only in response to a notice under section 148 and lacks reasonable cause for not filing the original return. However, the tax sought to be evaded must be computed under clause (c) of Explanation 4 after reducing tax deducted at source before the section 148 notice. Where pre-notice tax deducted at source exceeds the final assessed tax liability, no tax is sought to be evaded and penalty under section 271(1)(c) is not leviable. The penalty was deleted.

Rejection of books of account and profit estimation in a redevelopment project is unjustified where the purported comparable operates at a materially different scale and lacks redevelopment-specific costs. Alleged sales below ready-reckoner value require examination against values prevailing on booking dates, not incomplete data. Cash receipts disclosed under the Income Declaration Scheme may be credited where the disclosure relates to parking-slot sales in the sole redevelopment project. Pending approvals and the occupation certificate support revenue recognition under the project-completion method. An addition based solely on a survey statement cannot be sustained without corroborative evidence.

Customs-duty liability for pilfered imported goods arises independently against a customs-area custodian once it has been approved under the Customs Act. A statutory Port Trust may be approved as a custodian because its conditional civil liability as bailee under the Major Port Trusts Act differs from the statutory obligation owed to Revenue for pilferage. The saving clause governing custodian approval does not prevent approval where the other enactment imposes no corresponding customs-duty liability. The overriding provision applies despite other laws, but liability for pilferage cannot arise for periods preceding the custodian's approval.

Customs clearance facilitator liability for differential duty requires foundational proof that the facilitator acted with express or implied authority from the owner or importer, or knowingly participated in misdeclaration or smuggling. Filing a Bill of Entry, paying assessed duty, and arranging examination and clearance do not by themselves establish ownership, beneficial ownership, agency authority, or knowledge of concealed goods. Liability for differential duty and interest was therefore set aside. Penalty for duty evasion cannot survive without established duty liability arising from collusion, wilful misstatement, or suppression. Penalty for false customs documents also requires proof of knowing or intentional use; false documents alone are insufficient. The penalties were set aside as against the facilitator.

Tariff classification of imported mixed lots of polyester knitted fabrics requires evidence of the actual composition of goods covered by each Bill of Entry. A description as "polyester knitted fabric" does not, without testing or other cogent evidence, establish the characteristics needed to reclassify mixed assorted fabrics as fabrics of synthetic fibres. The declared classification under CTH 6006 9000 remained applicable, and the proposed classification under CTH 6006 3200, with differential duty and interest, was unsustainable. Penalty for misclassification also required proof of deliberate suppression, wilful misstatement, or intent to evade duty; an interpretational classification dispute did not establish those elements.

Personal penalties for alleged abetment of gold smuggling require proof beyond uncorroborated accomplice statements and suspicion. Where no incriminating article or alleged syndicate mobile connection was recovered from the Customs Hawaldar, the accomplice statement lacked corroboration in material particulars. Call records indicating communication with the Superintendent before seizure supported the defence that information had been conveyed, while the Department did not investigate whether other officers had been alerted. Tower-location evidence suggesting use of a mobile connection could not establish involvement. The personal penalties were therefore set aside with consequential relief.

Residuary penalty under section 117 of the Customs Act was unsustainable where specific penal provisions were available and the importer's omission arose from the supplier's failure to provide an invoice. After clearance, the importer verified the consignment, voluntarily disclosed the omitted invoice to Customs, and sought reassessment to pay duty on the entire consignment. As no material showed that Customs would otherwise have detected the irregularity, the Tribunal set aside the penalty imposed under section 117, allowed the appeal, and granted consequential relief.

Classification of low-ethoxylated non-ionic fatty alcohol ethoxylates depends on the tariff headings and Chapter Note 3 to Chapter 34. Classification as an organic surface-active agent under CTI 3402 1300 requires satisfaction of both the prescribed water-mixture condition and surface-tension reduction. Test results showing a translucent liquid separating into two layers failed the requirement of a liquid or stable emulsion without separated insoluble matter. HSN Explanatory Notes place water-insoluble surface-active products outside Heading 3402 and under Heading 3824 where no more specific heading applies. The imported goods were therefore classified under CTI 3824 9090/3824 9990, rendering the proposed duty, interest and penalties unsustainable.

Goods imported into an SEZ for authorised operations remain exempt from customs duty until their removal to the Domestic Tariff Area. The statutory fiction for SEZ-to-DTA removals applies duty treatment equivalent to comparable imports only at the stage of DTA clearance and does not create an earlier liability. Where imported fabric was still to undergo authorised operations in an FTWZ, differential duty on the imported goods could not support a bank-guarantee condition for provisional release. Release may be secured by a bond equal to the goods' value, restricted to authorised FTWZ use, with duty payable when the resultant manufactured goods enter the DTA.

Under Section 138B, a customs statement offered to prove its contents is relevant only in prescribed circumstances. A retracted statement, where specifically requested cross-examination is refused, cannot serve as legal evidence against a noticee. In confiscation proceedings, untested statements cannot independently establish that seized gold was smuggled or that the person knew it was liable to confiscation. Denial of cross-examination undermines confiscation and penalty findings under customs law.